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March 21 (UPI) — U.S. markets closed with slight losses Monday in a volatile day of trading spurred by Federal Reserve Chairman Jerome Powell expressing concern about inflation.
The Dow Jones Industrial Average fell 201.94 points, or 0.58%, while the S&P 500 dropped 0.043% and the Nasdaq Composite declined 0.4%.
Powell pledged to take strong action against inflation which he said “is much too high” despite a “very strong” labor market, in prepared remarks to the National Association for Business Economics.
“We will take the necessary steps to ensure a return to price stability,” Powell said. “In particular, if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.
“And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that, as well.”
After Powell’s comments, the 10-year treasury yield rose 16.7 basis points to 2.3150%, its largest gain since March 2020.
“As the Fed progresses down this path of both hiking rates and shrinking their balance sheet, there will be no such thing as a soft landing,” Peter Boockvar, chief investment officer at Bleakley Advisory Group wrote in a note.
“The only question is how much of an economic slowdown are they willing to tolerate to quell consumer price inflation at the same time asset price inflation deflates along with balance sheet shrinkage.”
Facebook parent, Meta, dropped 2.31%, and Microsoft slid 0.42% as tech stocks declined in response to rising yields.
Boeing stock fell 3.59%, after one of its 737 aircraft carrying more than 130 people crashed in China.
Conversely, oil prices saw gains Monday as West Texas Intermediate crude, the U.S. oil benchmark rose more than 6% to above $112 per barrel at session highs, and Brent crude, the international standard, climbed to more than $116 per barrel.
Marathon Oil gained 8.54% and Occidental Petroleum rose 8.45%.
